HTC, Motorola Making Fewer Android Phones as Samsung Pulls Away

Android OEMs Motorola and HTC are curbing their smartphone and tablet production in 2012, while Samsung holds the line.

Google
(NASDAQ:GOOG) likes to boast that there are more than 200 million devices,
including over 300 different types of smartphones and tablets, based on its
Android operating system in the market worldwide.
But while
consumers are dazzled and perhaps dizzy from the sheer volume of choices in
front of them, Android OEMs who have practiced throwing dozens of devices
against the wall to see what will resonate with consumers are scaling back
their toy factories.

Motorola
Mobility (NYSE:MMI) and HTC, which each reported disappointing earnings for the
fourth quarter, have both vowed to make fewer devices in 2012.

Motorola CEO Sanjay Jha tipped the industry off
to his company's plan in January during the 2012 Consumer Electronics Show,
where he said the company wanted to make fewer phones and steer clear of
"incremental innovation."
The reason?
There's no profit to be gained from selling devices that are roughly the same.
Jha should know. Motorola last fall released the Droid Bionic smartphone, a 4G
LTE (Long-Term Evolution) device that looks, feels and performs like a better
variation of the company's Droid X smartphone.
The company is
also on its fourth flagship Droid device, with each one being only
incrementally better than the last.

HTC is in a
similar boat, launching devices such as the HTC ThunderBolt and HTC Evo 3D smartphone,
a followup to the company's popular Evo 4G handset from 2010. HTC also launched
the HTC Evo View 4G and Jetstream tablets.
HTC U.K. chief
Phil Roberson told Mobile Today
the company will launch a number of high-end devices this year. "We have
to get back to focusing on what made us greatamazing hardware and a great
customer experience," Roberson said. "We ended 2011 with far more
products than we started out with. We tried to do too much."
Even so, Barclays Capital said HTC will announce four new
smartphones at the Mobile World Congress later this month.
Motorola and
HTC have learned a valuable lesson. While smartphone users are a growing
number, the market will only bear so many like devices. It's hard enough
competing with Android handsets from different OEMs and Apple's (NASDAQ:AAPL)
popular iPhone. Motorola and HTC needn't build devices that compete with each
other.
Interestingly,
while Motorola and HTC are scaling back device-making, top Android OEM Samsung
is still pumping out phones at a ferocious pace.
The company
launched its popular Galaxy S II line in the U.S. last fall, followed it up with
the Galaxy Nexus Android 4.0 Ice Cream Sandwich handset, and is preparing the S
III line for a launch later this year. The company recently unveiled some
low-end models as well.
Samsung
declined to comment for this story, but the company's behavior indicates it
doesn't believe it's releasing too many phones.
Moreover,
while Motorola and HTC have struggled financially, Samsung had a great hardware
quarter, shipping 36 million smartphones alone. Still, Current Analysis analyst
Avi Greengart said Samsung has too many variants as well.
"The
problem isn't the "big" phone releases, like the Galaxy S, which is
launched about once a year," Greengart told eWEEK. "The problem is the proliferation of variants on those
big models. Samsung has three different Galaxy S II models just at AT&T
alonea plain one, one with a sliding QWERTY keyboard and one with LTE."
"The
proliferation of models means more consumer choice, but it also means choice
paralysis, where consumers can't figure out which phone to buy (and sometimes
just buy an iPhone instead). It also multiplies the challenges for vendors when
it comes time to update the software."
Those
challenges can lead to platform fragmentation, which has been an ongoing
bugbear for Android, though perhaps not so serious as originally thought.
Regardless, it's clear that Motorola and HTC are changing their approach to the
Android device business this year, even as Samsung chugs along.